New data from the Canadian Institute for Health Information (CIHI) estimates that in 2024, health care spending in Canada is expected to increase by 5.7%, after rising 4.5% in 2023 and 1.7% in 2022.
As a result, health expenditure growth in 2024 is expected to outpace the growth of the economy.
Spending is expected to reach $372 billion in 2024, which roughly translates to $9,054 per Canadian. This accounts for 12.4% of Canada’s gross domestic product (GDP).
Excluding the 2020 and 2021 pandemic period, this is the highest ratio ever reached.
As in previous years, hospitals (about two-thirds of which is employee compensation), drugs and physicians remain the major areas of spending. Combined, those three areas are expected to represent over 50% of total health care spending in Canada in 2024.
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“Healthcare is becoming more and more of a priority for our government,” says the Program Lead for Financial Standards and Information at CIHI, Pierre Leveille.
“This is not the first time we’ve seen health spending outpace the growth of the economy. We saw a similar trend in the early 2000’s when we had a ten-year health accord.”
The accord being referred to is entitled “A 10-year Plan to Strengthen Health Care,” and was an intergovernmental agreement supported by over $41 billion in incremental federal funding. It focused on improving access to health care and included commitments in priority areas that reflected the challenges identified at the time.
Leveille says that current priority areas include population growth, population aging, the geography of having to deliver services, as well as the burden or need of healthcare providers.
“It’s interesting to note that we heard a recent accountment of another ten-year health accord, where there would be a sharing of $200 billion over ten years between the federal and provincial government,” says Leveille.
Leveille stresses that the growth in expenditure translates to the dispersion of money by the government and does not directly impact the cost taxpayers are spending for these services.
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